Europe looks at Obama's banking proposals as an effort to regulate Anglo-Saxon Capitalism

Perhaps stung by criticism that, after one year in office, he has failed to live up to his pre-election hype, US President Barack Obama is finally taking on the might of Wall Street.

But these wide-ranging problems of big banks range across the world, and not just in the US.

European banking giants such as Credit Suisse, Deutsche Bank, BNP Paribas, Barclays, UBS, HSBC and, to some extent, Royal Bank of Scotland (RBS) are all heavily involved in these bad practices.

While proprietary trading covers a wide range of activities, the part of it that could realistically be targeted by regulation accounts for just 1%-2% of a European bank's overall revenues, says Simon Maughan, co-head of equity research at MF Global Equally, he argues, European banks have been winding down their private equity functions and trading less in hedge funds". Such reforms would be a lot less ugly for European banks than for the likes of [US banks] JP Morgan and Bank of America." 

German Chancellor Angela Merkel recently talked of vindication for the social market economy in the light of the global financial crisis that many in Europe have blamed on rampant Anglo-Saxon capitalism. French President Nicolas Sarkozy has made similar noises.

If the US and the UK do go ahead with Mr Obama's proposals and Europe does not, then European banks stand to gain an enormous competitive advantage, analysts say.

For more; BBC News - Obama's banking proposals: The impact on Europe